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Tax watch  Taxes across the nation

March 9, 2000 -- Because the federal income tax is the biggest and usually the first tax we see listed on our pay stubs, we naturally tend to focus on it.

But state government takes a bite out of our spending money, too. Bankrate will help you stay on top of what your localities are collecting -- income, sales, personal property or investment taxes, or often a combination of all.

Here's a look at some recent tax actions across the nation.

Illinois tax scofflaws listed online
SPRINGFIELD -- Efforts by Illinois revenue collectors to shame tax scofflaws into paying up seem to be working.

Last year, the state's Department of Revenue began posting the names of delinquent taxpayers on its Web site. The list now contains the names of 229 individuals and businesses that together owe the state more than $16.2 million in state taxes.

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Since the posting began, state officials say 903 listed taxpayers have coughed up nearly $10 million and 169 more have entered into formal agreements with the state to pay another $9 million in installments. Of the total collected, approximately $2 million has gone to pay local government taxes.

"The Department of Revenue's efforts today should assure those taxpayers who pay their taxes that we will do everything in our power to collect final tax debt owed the state," Revenue Director Glen Bower said.

Certified notices were mailed last March to 5,213 taxpayers who had owed more than $10,000 each in taxes for at least six months, telling them that unless they made full payment or agreed to payment plans, their names would be published under the new law.

Cheaper snacking on the way in Maine
AUGUSTA -- Snackers in Maine may find their treats soon will be a bit cheaper.

State election officials have cleared the way for a referendum on repealing Maine's tax on doughnuts, ice cream and other snacks. But legislators may beat the electorate to the punch. There is bipartisan agreement that the snack tax should be repealed this session.

The Don't Tax Food Coalition of Maine led a group of anti-snack tax activists in celebrating the move. The group noted that when the snack tax was enacted in 1991, the state was facing a fiscal crisis and looking for ways to raise money. It was seen as a temporary "quick fix" measure at the time, according to the coalition.

While staples were protected from the sales tax, the 5.5 percent tax was imposed on foods sold for consumption with little or no preparation. They include such foods as corn and potato chips, popped popcorn, granola bars, bread sticks, cakes, pies, ice cream, marshmallows and beef jerky.

Lawmakers say the state has enough surplus to cushion the tax loss, which would add up to about $14.5 million over the current budget cycle.

Pennsylvania GOP looking to help heirs
HARRISBURG -- Pennsylvania's inheritance tax will be a target of state Republican leaders when budget deliberations begin this spring between the governor and the legislature.

Republican Gov. Tom Ridge already has proposed a cut of $644 million in taxes for low-income families, businesses and homeowners, including a $330 million property tax rebate. But he does not include any reduction in the inheritance tax.

State senators, who are leading the movement, want a $100 million reduction in the tax that would affect lineal and non-lineal descendants. Pennsylvania's inheritance tax is 6 percent on assets left to descendants and 15 percent bequeathed to all others. In addition, the state taxes the total value of any estate, whereas the federal government taxes only estates worth more than $675,000 in 2000.

Anti-tax advocates believe an inheritance tax cut is possible along with the governor's other proposals because they expect a larger budget surplus than has been officially projected.

Ridge says he supports an inheritance tax cut, but doubts there will be enough money to accomplish his cuts plus repeal inheritance taxes simultaneously.

Judge says Michigan tribes can end casino payments
GRAND RAPIDS -- A portion of slot machine earnings from Native-American casinos in Michigan will no longer go to state coffers, thanks to a federal judge's ruling.

Under a 1993 agreement, seven of the state's tribes had been paying 8 percent of slot winnings to Michigan's Strategic Fund. The payments were to continue as long as the tribes "collectively enjoy the exclusive right to operate electronic games of chance."

But in 1996 tribal leaders decided to stop payments because state voters OK'd casino gambling in Detroit, ending the tribes' exclusive right to operate gambling machines. Federal courts initially rejected the tribal argument, saying that since the Detroit casinos were not yet a reality the tribes still had a monopoly.

But when state officials signed gambling compacts with four more tribes, the seven original tribes again claimed their monopoly was broken. This time U.S. District Judge Douglas W. Hillman in Grand Rapids agreed.

The tribes released from the payments by the ruling are the Saginaw Chippewa, the Sault Ste. Marie Tribe of Chippewa Indians, the Grand Traverse Band of Ottawa and Chippewa Indians, the Keweenaw Bay Indian Community, the Hannahville Indian Community, the Bay Mills Indian Community and the Lac View Desert Band of Lake Superior Chippewa Indians.

Michigan is appealing the ruling.

-- Updated March 9, 2000

 

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